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Profits Build

Profits Build

February 10, 2017

Chapter 81 in the exclusive series for Dynamic Commodities- becoming a commodities trader

With the nickel, precious metals and options business under my belt in London my profile in the company and in the world of commodities trading was rising. The fact that those businesses started doing a lot better after I arrived did not hurt.

I went to London because the previous manager was not aggressive. When I got there I was an animal. I immediately started a program to increase central bank gold deposits, producer lending and the arbitrage business in gold. I knew that was the most fertile ground when it came to making an immediate impact to the company’s bottom line and I was not wrong.

Gold was trading at the $400 per ounce level in 1988 and with each new ton of central bank gold, the annual profit grew by at least a quarter of a million bucks. At the same time, I encouraged the traders to take more risk each day. The gold and silver trading, arbitrage and banking business began to yield immediate fruit. The previous year London contributed around $1 million to the bottom line of the global precious metals business. I blew that number away in the first two months on the scene. When it came to nickel, the losses turned into a small profit. I was sitting pretty and Marty, Henry, and Chris Linen were very happy with my performance.

While profits were increasing other aspects of the job were becoming intolerable. The ex-manager had become a major thorn in my side trying to undermine me at every opportunity. Within the department, the political shenanigans made each day a struggle and created disunity among staff. I would often disappear to the oasis of the nickel desk for a rest from all of the nonsense and politics. The man I was replacing was unable to get any traction against me. After all, in companies like Philipp Brothers, the only thing that mattered were profits and with the money rolling in since I arrived on the scene, he became a sideshow to management who continued to ignore his existence.

Aside from Chris Frith my chief dealer who was supportive, I began to establish closer relationships with two traders on the desk who were still semi-loyal to the previous boss. Bennie Bieri was the options trader working with Peter Grinham and he was starting to come around. Both Bennie and Peter reported to Sid but he was in New York and while the manager on the scene before I arrived was still in the room, Side commanded total and complete loyalty. Bennie was receptive. Jeremy East, the forward trader, liked the changes I was making but he needed to remain apolitical so as not to upset his former boss. The other traders were either on the ex-managers side or too scared to share their true feelings. I knew that eventually things would work themselves out and the politics would get better. The profits kept me going and helped me to rise above the politics. As long as the bosses were happy, there were no real worries.

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Post Series: Origin Of A Commodities Trader

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